Brightside confident despite eLife squeeze on 2010 results

Broking group Brightside is planning to add five more insurers to the panel of its eCar online motor business, the company said in a trading update. The eCar multi-insurer panel has already gone live with three companies.

Brightside acquired eCar along with eBike from Southern Rock Insurance Company in May. The two units started operating as part of Brightside on 1 July. Brightside chief executive Paul Chase-Gardener is one of the owners of Southern Rock.

Brightside said it traded “very strongly” during the second half of 2010, with the general insurance businesses producing profits significantly ahead of its initial expectations. Policy sales increased by 68%, and Brightside expects both eCar and eBike to make a positive contribution for the financial year of approximately £1m after the expected amortisation charge. However, the second half was marred to an extent by policy lapses in Brightside’s eLife business, which it is now revamping.

“ELife continues to disappoint and experienced accelerated lapse rates in the second half of the year from leads purchased from internet based distributors,” the trading update read.

“This practice is now discontinued and the result for the year will include a material provision against potential future lapses. The business is now being developed through affinity referrers from a significantly lower cost base.”

Brightside expects its overall results for the year ended 31 December 2010 to be in line with expectations. “The board views the prospects for the 2011 financial year with confidence,” the statement said.